Survey Finds 1 in 4 Financial Pros Have Personal Knowledge of Business Wrongdoing

For those who say Wall Street is evil, there’s new research data culled from finance industry professionals to back that up.

A recent survey of 500 brokers, analysts, and hedge-fund managers on the ethics of their business practices found a quarter of them said they had firsthand knowledge or experience of wrongdoing in the workplace.

The study conducted by research group Populous for the law firm Labaton and Sucharow turned up other disheartening results:

• Nearly a quarter of survey participants said they thought financial services professionals needed to engage in wrongful business practices in order to be successful.

• Only 41 percent of those surveyed responded with certainty that those in their company had not acted unethically.

Since the 2008 financial collapse, and with major regulations like the Dodd-Frank act in place, the federal government has tried to enact major reform on the financial industry. However, only one in four respondents to the survey said they found regulatory committees like the Securities and Exchange Commission to be of any real weight.

Almost a third of respondents said they felt pressured to engage in unethical or illegal activity in order to obtain bonuses or fill quotas.

Nearly all of the survey’s respondents (94 percent) said they were willing to report wrongdoing. But fewer than half said they knew of the SEC’s whistleblower program.

And 16 percent of those surveyed said they would break the law for financial gain if they knew they could get away with it.

The researchers were surprisingly blunt.

“What prompted the scandals that played a central role in the downfall of so many institutions?” they asked in the study’s introduction. “Call it greed. Call it slack compliance. Call it conflicts of interests. The fact is, too many organizations – both central to the crisis and in its periphery – have lacked a strong culture of integrity.”

“In the end, one of the most significant lessons to emerge from the global economic crisis is that corporate ethics matter.”